24 March 2010Exporting 101 Building International Sales Assessing Risk & Opportunity Craig A Harvey Chair, MSDEC

24 March 2010Exporting 101 Topics Why Export Taking Advantage of Free Trade Agreements Assessing & Managing Country Risk –Regional Opportunities and Challenges

24 March 2010Exporting 101 Why Export State and Federal Support, commercial shippers –Best friends Controlled Growth in Predictable Markets –Who needs what, and how much Manageable Risk –Pick your place Exponential Growth Potential –Only so much of any product needed in state/country

24 March 2010Exporting 101 Why Export Untapped Markets –New technology highly desired in certain regions/countries Dollar a bargain vs. many other currencies Leverage Existing sales forces (agents) Improve on profits, simple transactions Market values based on local economy –Diversify markets/customers/economies

24 March 2010Exporting 101 Why Export - Country2007 Million USD2008 Million USDPercent Change NAFTA332,499353, % Canada213,118222, % Mexico119,381131, % CAFTA-DR21,27423, % Costa Rica4,2245, % Dominican Rep5,7936, % Guatemala3,8724, % Honduras4,3274, % Nicaragua8461, % El Salvador2,2092, % Australia17,91620, % Bahrain % Chile7,61011, % Israel9,94010, % Jordan % Morocco1,3331, % Oman1,0341, % Peru3,7645, % Singapore23,57625, % Total420,348456, %

24 March 2010Exporting 101 Leveraging Free Trade Agreements What is a Free Trade Agreement? –Improving intellectual property right protection –Enhancing labor rights –Government procurement –Opening service sectors to competition –Enhancing rules on foreign investment –Environmental standards –Improving customs facilitation –Dispute settlement Bilateral Trade Agreements –Australia, Bahrain, Chile, Israel, Jordan, Morocco, Peru, Oman, and Singapore Multi-lateral Trade Agreements –North American Free-Trade Agreement (NAFTA) – Central America-Dominican Republic Free Trade Agreement (CAFTA)

24 March 2010Exporting 101 Why Free Trade Zones Free Trade Agreements –CLOSE (travel) –Usually English 2 nd language –Similar Laws, (different applications maybe) –Easier Entry, more core knowledge –Cheaper shipping Free Trade Agreements are considered priority markets by: –Federal Government –State Government

24 March 2010Exporting 101 Assessing & Managing Country Risk Regional Opportunities Where to attempt to export first –Risk Financial Personal Security (Intelligence) –Support US Commercial Service –MSDEC State Department MDA EDU Shippers/Logistics (FedEx. Etc)

24 March 2010Exporting 101 Assessing & Managing Country Risk Challenges –Understanding Environment Crime Legal system –Understanding Culture Customs Society –Understanding when and where to adhere to customs (legality) Support –EXIM –US Commercial Service –MDA –Shippers/Logistics Partners (FedEx, etc.)

24 March 2010Exporting 101 Summary All opportunity involves risk, International opportunities have risk too but you have the support of entire federal and state agencies to mitigate those risks Do your homework, if you approach exporting and remain ignorant the costs can be high Exhaust available help/support, most is free or available for a nominal charge

24 March 2010Exporting 101 Questions?